pay up

big oil again.. wasting our time

Several ironic or amusing points emerged during the Senate's round of political pandering to idiotic voters. Just in case you are confused about the idiocy of these voters, witness the attached poll results which depict big oil as the usual suspect rather than supply and demand, or even OPEC which controls much of the crude oil that these oil companies depend on to bring to markets here for use and refinement.

If that wasn't enough, the hecklers of the public showed their intellect by demanding that the oil companies bring down the prices. Perhaps if they themselves, the public, had less use for gasoline the price would go down.
Oil companies may be greedy profiteers selling a product people need, but if people don't need it, either they won't buy it or won't buy as much of it. They will charge whatever people will pay. Don't want to pay that much, find a way not to need it so much. If you can't do that or don't want to make the difficult choices with how you budget, shut the fuck up. Your idiotic bitchings made outside your hummer at the gas station will help no one.

The more amusing points were along these lines. Oil companies were requesting the ability to drill for oil off the Florida coast, in ANWR, and points in between. Congress was criticizing the oil companies for not investing enough money in oil exploration however. To my mind, precisely why wouldn't they want to drill for oil anywhere they could if the barrel is selling at $125+? Oil companies would of course want to get as much out of the ground right now as they could relative to years where the price of crude was a pittance. But when the supplies are restricted by 1) cartel control over much of the known oil reserves..or 2) Congressional restrictions over known and suspected domestic reserves, then oil companies of course are not going to spend much on oil exploration. They might, and as far as I can tell, have instead money to spend on oil alternatives, and they're being soaked in it with the subsidies for ethanol going out anyway.

Next point of amusement. With a domestic subsidy on relatively inefficient production of corn ethanol or even switch grass fuels and biodiesel, we have a tariff on foreign imports of ethanol, such as the sugar based fuels that Brazil used to achieve domestic energy independence. Oil companies called for the removal of the foolish protectionism as what that does is discourage the corn ethanol production from seeking greater levels of efficiency anyway, meaning it drives up the price of ethanol fuels. Much as people are willing to mock big corporations, the people in charge of them tend to have some idea what they're doing. Average Americans generally don't when it comes to money.

Now that I think of it, it might be better if that poll had included another choice: the federal government. Not content to drive up oil prices by restricting supplies and imposing anti-trade initiatives on alternative fuels, they also have the nerve to place taxes in the amount of 40-60 cents per gallon and then call in oil executives as though they're the ones driving up the price.



Meanwhile none of this troubles me a wit. I could care less if gas approaches $5 a gallon and have no interest in telling Congress or big oil to do something about it. Europeans and Japan have been paying well above that for years because of self-imposed energy taxes. While oil is now increasing well beyond the inflation rate, part of the reason is that the American dollar has been weakening internationally. My greater concern, and something the government could actually do since it can't impact gas prices directly without making some embarrassing admissions, is work on the general inflation rate and hammer that back into something reasonable. It varies depending on who does the study but it's anywhere from 4% (tolerable) to 10% (definitely not). The price of energy is a factor in these calculations, but it's not the only thing going up.

It's conceivable that one of two things are going on. 1) the dollar is weakening in order to strengthen the domestic economy. Strange as that seems, when the dollar is down our exports are cheaper and imports are more expensive. People keep more of their dollars at home on local or national items. This plan however falls flat because China's yuan is still pegged to the dollar. Imports won't get more expensive from there and exports won't get cheaper. So if that's the plan, it's only effective for Europe and the parts of Latin America we haven't pissed off. or 2), the dollar is weakening so the Fed can use inflated dollars to pay off Social Security and the federal debt. People on Social Security won't be very happy about it, but since I don't expect to see the stuff myself.. not my problem really. I don't much care for that plan either however as it rests on driving up inflation to scary levels.